Futures up sharply on strong jobs data

The Associated Press

March 8, 2013 09:34 AM

The Associated Press

March 8, 2013 09:34 AM

U.S. stock futures rose sharply and the Dow Jones industrial average is likely to push higher into record territory Friday after the government released surprisingly strong jobs numbers and said that the unemployment rate dipped to a four-year low.

Employers added 236,000 jobs last month, far exceeding economist predictions. The unemployment rate broke out of a stubborn range of 7.8 percent or above since September, falling to 7.7 percent.

There are still millions of unemployed Americans and on Friday, Google announced an additional 1,200 job cuts at its Motorola division. That is on top of the 4,000 job cuts announced last summer.

Also on Friday McDonald's reported that comparable-store sales slumped again as it wrestles with economic strains in countries worldwide.

Sales at U.S. stores open at least a year dropped 3.3 percent, but the figure would have been flat if the impact of an extra day is excluded. Investors are paying close attention to those domestic sales for evidence that the payroll tax, which jumped in January, is cooling the desire of U.S. consumers to spend. Americans are also absorbing higher gas prices and a delay in federal tax returns.

But the unemployment report Friday backed up market optimism after the Labor Department released weekly unemployment claims numbers on Thursday, pushing the Dow to new highs.

The Commerce Department reports wholesale inventories later in the day. Economists expect activity will resume strongly this year.